Current Ratio is calculated by dividing the Current Assets of a company by its Current Liabilities. It measures whether or not a company has enough cash or liquid assets to pay its current liability over the next fiscal year. The ratio is regarded as a test of liquidity for a company.
About Current Ratio
Typically, short-term creditors will prefer a high current ratio because it reduces their overall risk. However, investors may prefer a lower current ratio since they are more concerned about growing the business using assets of the company. Acceptable current ratios may vary from one sector to another, but generally accepted benchmark is to have current assets at least as twice as current liabilities (i.e. Current Ration of 2 to 1).
In accordance with recently published financial statements Adidas AG has Current Ratio of 1.4 times. This is 46.97% lower than that of the Consumer Goods sector, and 56.11% lower than that of Textile - Apparel Footwear and Accessories industry, The Current Ratio for all stocks is 48.15% higher than the company.